Get ready to cough up a higher property tax in Bengaluru

BENGALURU: Civic body hopes to mop up an additional Rs 700 cr after raising the tax from April 1; Total kitty may touch `2k cr Property taxes in city municipal limits will go up from April 1. Residential and commercial property owners will pay 20% and 25% more levy .

"The increase is marginal as we have missed three cycles. Property taxes in Bengaluru are one of the lowest in the country ," said V Rashmi, special commissioner, BBMP .

The civic body hopes to mop up an additional Rs 700 crore from this revision. Collections this year are estimated to touch Rs 2,000 crore.

Citizens can start paying taxes from April 1 and get a rebate of 5% in the first month, said M Shivaraju, chairman of Tax and Finance Standing Committee. "We will accept cheques at our offices only if the property tax liability is `10,000 or b e l o w. T h o s e above this figure will have to pay the taxes through online transactions (NEFT RTGS) or demand drafts," he added.

The BBMP has done away with the cheque system to deal with defaults from large property owners.

The BBMP has categorized the zones as A, B, C, D, E and F and the slabs vary according to the zone where the property is situated. It has also provided for depreciation in tax payment according to the age of the building. The depreciation ranges from 6% to 12% depending on the age.

There are about 15 lakh property in Bengaluru's municipal limits and property taxes are the main source of income for BBMP.

“The Karnataka Municipal Corporations Act mandates an increase every three years and the rate of revision is also capped. But we are invoking this provision only now while we could have done so thrice already,“ Rashmi said. The government too often told BBMP to fix its finances and improve collections from own sources.

The special commissioner added: “All properties for which taxes have been paid at anytime in the past eight years have been sorted ward-wise.We did not have a ward-wise list of tax-paid properties. Now we intend to put it in the public domain shortly.Thus such of those properties paying taxes and those not in the net will be known.“

“The demands of the city are rising but our revenues are not increasing proportionally. But, in recent months, after sustained campaigns, awareness about property taxes has gone up,“ Shivaraju, who represents the Shankarmatt ward, said.

Chief Minister Siddaramaiah, in his Budget on Friday, allocated Rs 4,222 crore to BBMP under various heads which is a huge jump over last year's grant of about Rs 2,000 crore.

Currently, the Goods and Services Tax (GST) is levied at 12 per cent on payments made for under-construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale.